Investment Advisory Service

Thursday, 22 May 2014

Is a condom a drug or a device or a just a sheath in between ?

Just pause for a few seconds before reading any further and think about the question I raised in the title of the post. Which category does a condom fall in ? A drug ? A device ? Or a sheath [protective covering] ?
If this question were to be posed to a set of adult, sane, rational and pragmatic humans; most likely choice might be a sheath, with device as a choice opted by a few and drug might be the least preferred option.

But if you were to ask this question to a lawyer or a law maker, he or she will first refer to the rule book or a dictionary. Now, this is how a dictionary describes the 3 terms :
A drug is, in the broadest of terms, a chemical substance that has known biological effects on humans or other animals. So, a condom is indeed made up of chemicals and surely has biological effects. No doubts about that. Thus, a condom might fit the definition of a drug. A device is a peripheral, attached to a part that expands its functionality. Well, condoms are peripherals and they are attached to a part. And some variety of condoms [ribbed, dotted ...etc.] do expand the functionality. Hurray, condoms satisfy the definition of a device also. Sheath is a protective covering or a wrapper. No confusion about it. If a condom can be a drug, if it can be a device, it surely can be a sheath. 

So, a lawyer will while making things clearer will leave you more confused than ever. No wonder, Shakespeare quoted in Henry The Sixth, " The first thing that we do, let's kill all the lawyers". 

Why am I talking about condoms all of a sudden? First reason is that with markets flying high with Mr. Modi in the cock-pit, there's nothing much to do. Secondly, my visit yesterday to a neighborhood chemist. The pack of my preferred brand of condoms which used to cost Rs 200 a pack was billed for only Rs 65. I blinked my eyes in disbelief and checked the price again. It was indeed 65. What's going on ? Condoms selling at 70% discount. I had an inkling that Acchhe din aane waale hain but didn't know that Acchhe din itni jaldi aane waale hain. A brief chat with the chemist revealed that the Government has fixed the maximum selling price of condoms and no condom can sell for more than Rs 6.5 a piece. I checked the price of all other condom brands and yes, he was right, the maximum price that a condom was selling for was Rs 6.5. I couldn't believe this. What business does a Government have in fixing the price of ...of all things ....condoms?

A quick search on Google revealed that indeed the chemist was right. The Dept. of Pharmaceuticals has fixed the maximum price of condoms through a Drug Pricing Order under Essential Commodities Act. The department has argued that a condom is an essential drug and hence pricing regulations apply to it. The companies selling the contraceptives have approached different High Courts at Delhi and Madras against the order. Here and here. As rightly argued by one of the companies, the cap on the prices would force the companies to stop production of premium condoms as they can't be expected to sell below the cost price. True, as Jim Rogers said "You can control the price or the supply but not both." If this mindless capping on the price continues, sooner or later, the luxury or premium condoms will vanish from the shelves.

With that stretch of logic of the pharmaceutical department, products like Dettol, Fair & Lovely, Bournvita, Complan and hundreds of other over-the-counter products can fall under the drug pricing regulations. Somebody forgot to remind the law makers that laws are at their best when they have a bedrock of common sense and not otherwise.

The department of pharmaceuticals has finally decided to set up a standing committee to look into the matter. My suggestion to the committee : Sit down, relax , take a deep breath and think logically about this issue. The future of this country is in your hands, literally.